[Exclusive] Gildong Samik Park Reconstruction Accelerates... "Early Selection of Construction Company"

Samik Park Reconstruction Association Promotes 'Joint Project Implementation Method'
Selects Construction Company Before Project Plan Approval to Shorten Period
Construction Firms Say "Advantage in Securing Project Early Despite Bearing All Costs"

[Asia Economy Reporter Noh Kyung-jo] The reconstruction association of Samik Park Apartment in Gil-dong, Gangdong-gu, Seoul (hereinafter Samik Park) is accelerating the project through amendments to the articles of incorporation immediately after receiving approval from the Seoul City Architectural Deliberation Committee. The association plans to save time by adopting a 'joint project implementation method' in which the construction company participates in advance.

According to the maintenance industry on the 11th, the Samik Park reconstruction association held an annual general meeting at the Gangdong-gu Community Center the previous afternoon and amended the articles of incorporation to allow the selection of a construction company regardless of the approval of the project implementation plan.

Out of a total of 1,095 association members, 858 attended the general meeting (by written proxy and on-site), forming a quorum, and among them, 812 members (94.6%) approved the agenda.

The joint project implementation method means that the association and the construction company share the status of the implementer, which differs from the general contract system where the association is the implementer. In this case, the construction company procures various costs such as association operating expenses, land compensation, and relocation costs and lends them to the association. There are risks such as unsold units and interest rate fluctuations. The association also has to share project profits with the construction company, reducing profitability.

However, advantages include shortening the project period and transparent fund management and execution. Generally, in maintenance projects, the selection of a construction company occurs after the approval of the project implementation plan, but if joint project implementation is promoted, the construction company can be selected once the architectural deliberation stage, which is the previous step, is passed.

Earlier, the Seoul City Architectural Committee conditionally approved the architectural and landscape deliberation plan for the Samik Park reconstruction project on the 26th of last month. Specifically, it included ▲ adding separate play, rest, and exercise facilities for the elderly in outdoor spaces ▲ measures to address sunlight obstruction to Samik Mansion (Samik Garden).

Some voices express concerns about the joint project implementation method amid the economic downturn linked to interest rate hikes. Regarding this, a construction company official said, "Although the construction company finances all costs, there is nothing particularly bad about finalizing the project early."

The association can also legally receive proposals for relocation costs, facilitating smooth project progress. This is because the amended Urban Residential Environment Maintenance Act, effective from December this year, newly stipulates that "construction companies cannot propose moving expenses, relocation costs, or relocation promotion costs to the association."

The Samik Park reconstruction project has progressed rapidly from the start. After the designation of the maintenance zone in February 2020, the approval of the association establishment promotion committee was granted in about six months, and less than five months later, the association establishment was approved. This amendment to the articles of incorporation was also processed within five days after the final approval of the architectural deliberation on the 5th. The association aims to announce the relocation plan by the end of next year.

Samik Park, which has been completed for over 30 years, is expected to be reborn as a large complex with up to 35 floors and 1,665 households, up from the existing 12 floors and 1,092 households.